Kanglong into, pharmaceutical stone technology 2020 mid-year report released in the epidemic CXO industry continued to be high business climate.

On August 26th, Kanglonghuacheng and Pharmaceutical Stone Technology released their 2020 Mid-Year Report.
are the two companies in the CXO field? Kanglong into the first half of the net profit growth of 196.89 percent, gross margin increased by 4.34 percentage points Despite the impact of this year's new crown epidemic, but the first half of Kanglong into the performance is still very bright.
According to the report, during the reporting period, the company achieved revenue of RMB2,193 million, up 34.01% YoY;
company's profits to achieve high growth, the overall profitability further improved.
Chart 1: Kanglong into the first half of 2020 major financial situation Source: Kanglong into 2020 semi-annual report From the specific business sector, Kanglong into the laboratory services, CMC services and clinical research services three business sectors have resumed high growth: laboratory services camp Revenue was 1,434 million yuan, up 35.28% YoY, CMC Services revenue was 506 million yuan, up 34.38% YoY, and clinical research services revenue was 225 million yuan, up 27.51% YoY.
Among them, CMC services were affected by the shutdown during the outbreak, the Q1 quarter performance growth slowed, however, thanks to the gradual improvement of the domestic epidemic situation and the accelerated transfer of overseas orders since the second quarter, the company's CMC business orders also accelerated delivery, project progress to catch up smoothly, the business sector in the Q2 quarter also resumed high-speed growth.
clinical research services were affected by the global outbreak - Q2's overseas clinical operations, especially in the United States, were more affected by the outbreak, and performance growth was slower than in the other two sectors.
, Kanglong into a gross margin is significantly lower than other enterprises in the same industry, so the company's gross margin situation is more concerning.
first half of this year, the company's overall gross margin was 36.41 percent and its net profit margin was 21.28 percent.
among them, CMC's business benefited from the scale effect, with gross margin increasing by 8.26 percentage points to 28.98 per cent, laboratory services by 3.87 percentage points to 41.34 per cent and clinical research services by slightly (-1.25pct) to 21.81 per cent.
In these three sectors, laboratory services as the company's largest revenue share and relatively high gross margin business segment, its segmentation of the high gross margin business biosciences share is expected to further increase, cornerstone business drug discovery brought about by the business synergies will continue to reflect.
Chart 2: Kanglong into 2020 three major sectors of business Source: Kanglong into 2020 semi-annual report in the first half of 2020, Kanglong into the introduction of more than 190 new customers, more than 90% of revenue From the company's large, diverse and loyal repeat customers, including the world's top 20 pharmaceutical companies, and for domestic pharmaceutical and biotechnology companies to carry out 28 research new drugs clinical trial declaration projects, including many countries (including China, the United States and Europe) at the same time declared 20 projects.
company is expected to rely on high-quality customer resources and its own research and development advantages, and steadily improve the level of profitability.
Pharmaceutical Stone Technology's second quarter revenue growth rate of more than 100%, the overall gross margin continued to decline Pharmaceutical Stone Technology's net profit growth although not as bright as Kanglong into such a bright, but its Q2 quarter results than Q1 quarter has a significant speed up, performance is also very good.
The company achieved revenue of RMB459 million in the first half of this year, up 58.17% YoY; In the
quarter, the company's Q2 revenue, attributable net profit and non-attributed net profit growth rate of 108.46 percent, 65.35 percent and 66.78 percent, respectively, the performance has a clear accelerated growth trend.
is the same as Kanglong into the same, Q1 quarter affected by the outbreak, the company's performance growth slowed, and in Q2 quarter, benefit from the company's kilogram-class orders and technical services revenue growth, performance fully restored to a high-speed growth state.
Chart 3: Key Financial Situations of Pharmaceutical Stone Technology in the First Half of 2020 Source: Pharmaceutical Stone Technology 2020 Semi-Annual Report Pharmaceutical Stone Technology's main products are from laboratory-level molecular blocks to ton-level molecular blocks required in drug research and development and commercial production.
From the business revenue segment, the company's business revenue above the kg class in the first half of this year was 349 million yuan, up 76.8% YoY, while the business revenue below the kg class was 0.88 billion yuan, up 0.63% YoY, and the technical services revenue was 0.22 billion yuan, up 314.1% YoY.
, the proportion of business revenue above the kg class reached more than 70%, and achieved high-speed growth.
first half of this year, the company's key customer projects increased significantly, completing more than 200 different series of molecular block production business.
on the one hand, the domestic epidemic improved in the second quarter, overseas orders to the domestic transfer;
growth slowed for business revenues below the kg level, possibly due to factors such as reduced new projects and capacity constraints due to the impact of overseas outbreaks.
4: Pharmaceutical Stone Technology's Main Products or Services Source: Pharmaceutical Stone Technology's Semi-Annual Report 2020 It is also worth noting that the company's gross margin for the first half of the year was 45.06 percent, down 20 percent year-on-year.
From the gross margin of its main products or services, the gross margin of the three revenue sectors has declined, while the decline in the proportion of high gross margin business in the company's revenue structure has also led to a greater decline in the company's overall gross margin."
In fact, in view of the molecular blocks provided by Pharmaceutical Stone Technology has a certain uniqueness, high-tech barriers and low labor costs lead to a higher level of gross margin of its products, and in recent years, with the company's continuous efforts in the kg class project, the company's gross margin level also gradually fell back to the industry level convergence, which shows that the company's business chain has been extended from the upstream laboratory end to the downstream commercial production side.
Chart 5: Changes in Gross Margin of Pharmaceutical Stone Technology in Recent Years Source: Tonghuashun, Zhongkang Industrial Capital Research Center Chart 6: Pharmaceutical Stone Technology Revenues Make up 2019 VS 2020H1 (Inner Circle for 2019) Source: Tonghuashun, Zhongkang Industrial Capital Research Center under the epidemic, CXO industry continued to maintain a high degree of business climate of new drug research and development and its return there is a high degree of uncertainty, and CXO company as a pharmaceutical research and development industry "water seller", in the context of continuous improvement in research and development investment, the industry as a whole to maintain a high degree of prosperity.
even under the outbreak, the CXO sector has been less affected, continuing to maintain a high degree of prosperity and achieving steady growth in performance.
recently disclosed CRO/CDMO companies, the performance of enterprises in this sector in the first half of this year remains strong.
although Q1 was affected by the outbreak led to a phased slowdown in growth, but Q2 quarter has quickly returned to a high-speed growth state, the industry is expected to continue to maintain high-speed growth in the second half of this year.
same time, sharing the growth dividend of the global CXO industry, industry orders continue to shift to China, coupled with the impact of the epidemic, industrial transfer is more obvious, the follow-up overseas industrial transfer is expected to accelerate.
Chart 7: Partially disclosed REPORTED CRO/CDMO Enterprise 2020H1 Results Source: Tonghuashun, Zhongkang Industrial Capital Research Center.